40 TAC §§79.1701 - 79.1704
The Texas Department of Human Services (DHS) proposes new
Subchapter R, §§79.1701 - 79.1704, concerning Medicaid third-party
recovery, in its Legal Services chapter.
The purpose of the new sections is to comply with §1902a(25) of the
Social Security Act, 42 U.S.C. §1396a(a)(25), which requires DHS to implement
reasonable procedures to seek recovery from third parties who may have a legal
liability to pay for all or part of the services provided by Medicaid. The
proposal provides guidelines and procedures for the recovery of Medicaid program
expenditures from liable third parties and the distribution of the recovered
amounts among the state, the federal government, and the Medicaid recipient.
Eric M. Bost, commissioner, has determined that for the first five-year
period the sections are in effect there will be no fiscal implications for
state or local government as a result of enforcing or administering the sections.
Mr. Bost also has determined that for each year of the first five years
the sections are in effect the public benefit anticipated as a result of enforcing
the sections will be uniform procedures for recovering and allocating Medicaid
program costs from legally liable third parties. The procedure is coordinated
with that of the Texas Department of Health; the coordination of procedures
is expected to streamline recovery and thereby reduce overall Medicaid expenditures.
There will be no effect on large, small, or micro businesses, because they
do not change the amount liable third parties will pay in settlement of negligence
claims. The proposal clarifies the recovery and allocation of DHS's portion
of the settlement agreed to by the Medicaid recipient and the liable third
party, i.e., the Medicaid program expenditures for which a third party is
liable. There is no anticipated economic cost to persons who are required
to comply with the proposed sections.
Questions about the content of this proposal may be directed to Elmo Johnson
at (512) 438-3092 in DHS's Legal Services Department. Written comments on
the proposal may be submitted to Supervisor, Rules and Handbooks Unit-191,
Texas Department of Human Services E-205, P.O. Box 149030, Austin, Texas 78714-9030,
within 30 days of publication in the
Texas Register
.
Under §2007.003(b) of the Texas Government Code, the department has
determined that Chapter 2007 of the Government Code does not apply to these
rules. Accordingly, the department is not required to complete a takings impact
assessment regarding these rules.
The new sections are proposed under the Human Resources Code,
Title 2, Chapters 22 and 32, which authorizes the department to administer
public and medical assistance programs; and under Texas Government Code §531.021,
which provides the Health and Human Services Commission with the authority
to administer federal medical assistance funds.
The new sections implement the Human Resources Code, §§22.001
- 22.030 and §§32.001 - 32.042.
§79.1701. Basis and Purpose.
(a)
This section implements the obligation of the Texas Department
of Human Services (DHS) under federal and state law to:
(1)
set forth the requirements of Medicaid applicants and
recipients, and representatives of applicants and recipients, regarding assignment
of causes of action against third parties, or their insurer(s), responsible
for injury to the applicant or recipient that requires medical care and/or
services for which the third party or the third party's insurer is legally
obligated to pay; and
(2)
establish the priority of distributions of third-party
recoveries among DHS, the federal government, and the recipient.
(b)
This chapter does not address DHS's right of recovery
under:
(1)
§1917(d)(4) of the Social Security Act (codified
at 42 U.S.C. §1396p(d)(4)); or
(2)
third-party contracts with insurers obligated to
pay for health care for the recipient.
§79.1702. Definitions.
The following words and terms, when used in this chapter, have the
following meanings, unless the context clearly indicates otherwise.
(1)
Applicant -- An individual, or the parent or legal guardian
of an individual, who has applied to the Texas Department of Human Services
(DHS) or another agency of the state for medical assistance from the Medicaid
program.
(2)
Commissioner -- The Commissioner of the Texas Department
of Human Services;
(3)
Department or DHS -- The Texas Department of Human
Services and its designee.
(4)
Recipient -- A person who has been certified as eligible
to receive medical assistance from the Medicaid program by DHS or other agency
of the state.
(5)
State Plan -- The comprehensive written statement
submitted by the single state agency describing the nature and scope of the
Medicaid program and giving assurances that the Medicaid program will be administered
in compliance with Title XIX requirements and federal regulations.
(6)
Third party -- Any person, or the insurer of a person,
who is or may be liable to pay all or part of the expenditures for medical
assistance furnished under the State Plan.
§79.1703. Distribution of Recoveries.
(a)
The Texas Department of Human Services (DHS) will distribute
third-party recoveries as follows:
(1)
DHS will receive an amount equal to DHS's Medicaid expenditures
for the recipient or for another individual eligible for Medicaid benefits
under the State Plan for whom the recipient can legally make an assignment
to medical support and payment;
(2)
the federal government will receive the federal share
of the Medicaid expenditures, minus any incentive payment authorized by federal
law; and
(3)
the recipient will receive any remaining amount.
Any amount distributed to the recipient is income or resources for purposes
of establishing eligibility for Medicaid benefits.
(b)
DHS may pay reasonable and necessary attorney fees of
15 percent of the entire amount recovered on behalf of DHS, and reasonable
expenses, to a person authorized to recover amounts from third parties, other
than a person contracted by DHS to recover on behalf of DHS, if the recovery
is made in compliance with this subchapter.
(c)
DHS may pay prorated expenses, not to exceed 10% of the
entire amount recovered on behalf of DHS, if attorney fees are allowed under
subsection (b) of this section.
(d)
No attorney fees will be paid if the recovery made on
behalf of the Medicaid program is waived in whole or in part by the commissioner
under the provisions of §32.033(f) of the Human Resources Code and §79.1704
of this title (relating to Waiver Authority of the Commissioner).
(e)
The amount recovered on behalf of DHS for which attorney
fees are authorized under this section must be deducted from the total amount
of the recovery before attorney fees and expenses are deducted under the terms
of the recipient's contract.
(f)
DHS may pay reasonable and necessary attorney fees and
expenses to a person contracted by DHS to recover amounts from third parties
on behalf of the Medicaid program.
§79.1704. Waiver Authority of the Commissioner.
The commissioner of the Texas Department of Human Services (DHS) has
the authority to waive all or part of DHS's right to recover from liable third
parties when:
(1)
the commissioner finds that enforcement of DHS's right
of recovery would tend to defeat the purpose of public assistance; or
(2)
the cost of recovery exceeds the amount that could
be recovered.
This agency hereby certifies that the proposal has been
reviewed by legal counsel and found to be within the agency's legal authority
to adopt.
Filed with the Office of
the Secretary of State, on April 27, 2000.
TRD-200003005
Paul Leche
General Counsel, Legal Services
Texas Department of Human Services
Earliest possible date of adoption: June 11, 2000
For further information, please call: (512) 438-3108